LEHMAN BROTHERS SECURITIES N.V. Warrant and Certificate Programme. Guaranteed by LEHMAN BROTHERS HOLDINGS INC.

Transkript

1 SECURITIES NOTE dated 14 March 2008 LEHMAN BROTHERS SECURITIES N.V. Warrant and Certificate Programme Guaranteed by LEHMAN BROTHERS HOLDINGS INC. Issue of up to 2,500 Call Warrants due May 2011 linked to a Basket of Shares This document constitutes a securities note (the Securities Note ) for the purposes of Article 5.3 of Directive 2003/7 1 /EC and implementing measures (the Prospectus Directive ) for the purpose of providing information concerning the Warrants described herein. This Securities Note together with the registration document dated 8 August 2007, as supplemented by the supplements dated 15 October 2007, 4 January 2008 and 12 February 2008 (together, the Registration Document ) and the summary (the Summary ) dated 14 March 2008 and drawn up in connection with the issue of Warrants described herein together constitute a prospectus (the Prospectus ) for the purposes of Article 5.3 of the Prospectus Directive in respect of the Warrants described herein. Terms used herein shall be deemed to be defined as such for the purposes of the Conditions set forth in the offering circular dated 8 August 2007, as supplemented by the supplement dated 15 October 2007, 4 January 2008 and 12 February 2008 (together, the Offering Circular ) in connection with the warrant and certificate programme (the Programme ) of Lehman Brothers Securities N.V. (the Issuer ), Lehman Brothers (Luxembourg) Equity Finance S.A. and Lehman Brothers Bankhaus AG. Full information on the Issuer and the offer of the Securities is only available on the basis of the combination of this Securities Note, the Registration Document and the Summary. Copies of this Securities Note, the Summary and the Registration Document are available for viewing at the specified office of the Luxembourg Paying Agent and on the website of the Luxembourg at Save as disclosed herein, neither the Issuer nor the Guarantor is involved in any litigation or arbitration proceedings which the Issuer or the Guarantor (as the case may be) believes would have a material adverse effect on the financial position of the Issuer or the Guarantor (as the case may be) nor is the Issuer or the Guarantor aware of any such proceedings pending or threatened. RESPONSIBILITY The Issuer and the Guarantor accept responsibility for the information contained in this Securities Note and declares that, having taken all reasonable care to ensure that such is the case the information contained in this Securities Note is, to the best of their knowledge, in accordance with the facts and contains no omission likely to affect the import of such information. The information with regard to the underlying asset (or basket of assets), Commodity (or Basket of Commodities), Currency (or Basket of Currencies), Debt Instrument (or Basket of Debt Instruments), Depositary Receipt (or Basket of Depositary Receipts), Index (or Basket of Indices) or Share (or Basket of Shares) (as all such terms are defined in the Terms and Conditions) or other item(s) (the Underlying ) to which the Securities relate contained in Part C ( Information about the Securities) and the Annex (Information about the Underlying - Basket of Shares ) hereof, has been extracted from information publicly available and published by Bloomberg. The Issuer and the Guarantor confirm that such information has been accurately reproduced and that, so far as they are aware, and are able to ascertain from information published by Bloomberg, no facts have been omitted which would render the reproduced information inaccurate or misleading. The Issuer and the Guarantor accept responsibility as to the correct reproduction of such information, but no further or other responsibility (express or implied) is accepted by the Issuer or the

2 Guarantor in respect of such information and, in particular, the Issuer or the Guarantor have not independently verified any such information. The Issuer and the Guarantor shall not have any responsibility for any errors or omissions in the calculation and publication of the prices of or information relating to the Shares by Bloomberg. Investors may acquire such further publicly available information as they deem necessary and appropriate. IN WITNESS WHEREOF, LEHMAN BROTHERS SECURITIES N.V. has caused this Securities Note to be executed by a duly authorised officer or director. Executed by LEHMAN BROTHERS SECURITIES N.V. and signed and delivered on its behalf By: Name: Title: Date: 14 March 2008

3 TABLE OF CONTENTS Section Page No Part A - Risk Factors... 4 Part B - Information Incorporated By Reference... 9 Part C - Information About The Securities Part D - Norwegian Taxation Annex - Underlying - Basket Of Shares... 24

4 Part A Risk Factors Prospective investors of the Warrants should carefully consider the risk factors provided below as well as other information contained in this Securities Note, the accompanying Registration Document and the documents incorporated by reference before purchasing the Warrants. In particular please see the Risk Factors set out on pages 4-8 of the Registration Document and the risk factors set out in the Offering Circular and incorporated by reference herein. The Registration Document and this Securities Note however cannot disclose all of the risks and other significant aspects of the Warrants and investment decisions should not be made solely on the basis of these risk factors since the information contained herein cannot serve as a substitute for independent individual advice which is tailored to the requirements, investment objectives, experience, knowledge and circumstances of a prospective investor. Additional risks not outlined below or not currently known to the Issuer or that the Issuer now deems immaterial may also adversely affect the value of the Underlying and, therefore, the value of the Securities. Each prospective investor of Warrants should consider carefully whether the Warrants are suitable for it in the light of its circumstances and financial position and in view of the complexity and risks inherent in the Warrants. Prospective investors of Warrants should be experienced with respect to derivatives, particularly options and options transactions. Furthermore, prospective investors of Warrants should understand the risks of transactions involving the Warrants and should reach an investment decision only after careful consideration of the suitability of the Warrants in light of their particular financial circumstances and after consultation with their own legal, tax, accountancy and other professional advisers. No person should deal in the Warrants unless that person understands fully the nature of the relevant transaction. Such transaction is suitable only for, and should be made only by, an investor who has no need for liquidity and understands and can afford the financial and other risks of this transaction. Terms not defined herein have the same meaning as set out in the Offering Circular and Part C of this Securities Note. Factors affecting the Shares and the Cash Settlement Amount under the Warrants Prospective investors of Warrants should be familiar with investments in the global capital market and with derivatives and Shares generally. The Warrants do not bear interest. The value of the Warrants can be volatile. Changes in the price or market level of any of the Shares and/or changes in the circumstances of the issuers of the Shares or changes in the Rate may result in sudden and large fluctuations in the value of the Warrants. The value of any of the Shares may vary over time and may increase or decrease by reference to a variety of factors, which may include, but are not limited to, corporate actions and macro economic factors. Fluctuations in the value of any one Share may be offset or intensified by fluctuations in the value of the other Shares in the Basket. The Cash Settlement Amount is variable and dependant upon certain factors, which include the prices of the Shares on each of the Averaging Dates and the performance of the Rate. Prospective investors of Warrants should understand that in certain circumstances the Cash Settlement Amount may be less than the original price paid for the Warrants or may even be zero. The Cash Settlement Amount is calculated by reference to the Participation Factor and the Cap. The Participation Factor will be a percentage which will be a equal to per cent and the Cap will be a percentage which will be a minimum of 160 per cent. The Cap will be determined by the Calculation Agent in its sole and absolute discretion on the Strike Fixing Date, which is after the end of the Offer Period. Therefore, investors who agree to acquire Warrants during the Offer Period, or subsequently but on or prior to the Strike Fixing Date, will be doing so on the basis of a Cap which will not yet have been determined. The Calculation Agent will determine the Cap by reference, inter alia, to the average implied volatility of the Shares and the prevailing levels of Norwegian Krone related interest rates. The examples below illustrate the effect of these factors

5 on the determination of the Cap. However, prospective investors should appreciate that the exact impact of each factor will depend on market conditions at the time the Cap is determined and also that the two factors mentioned are not the only factors taken into account by the Calculation Agent in determining the Cap. Example of the effect of the volatility of the Shares and the prevailing levels of Norwegian Krone related interest rates on the Cap: Based on market conditions as of 11 March 2008, had the Cap been determined on that date, the Cap would have been determined to be 185 per cent. On 11 March 2008, the average implied volatility of the Shares, as determined by the Calculation Agent (the Average Volatility ), was per cent. Had the Average Volatility on that date been 1.00 per cent. lower, that would have resulted in an increase of 0.5 per cent. in the Cap, i.e. a Cap of per cent. Alternatively, had the Average Volatility been 1 per cent. higher on that date, that would have resulted in a decrease of 0.5 per cent. in the Cap, i.e. a Cap of per cent. On 11 March 2008, the 3 Year NOK Swap Rate (a NOK related interest rate) was per cent. per annum. However, had such rate been 0.25 per cent. per annum lower, that would have resulted in a decrease of 0.1 per cent. in the Cap, i.e. a Cap of 184.9, per cent. Alternatively, had such rate been 0.25 per cent. per annum higher, that would have resulted in an increase of 0.1 per cent. in the Cap, i.e. a Cap of per cent. Prospective investors should note that the above examples are solely for the purpose of illustration and should further note that the Cap is subject to a minimum of 160 per cent. and as such may be lower than the levels indicated above. As soon as practical after the determination by the Calculation Agent of the Cap on the Strike Fixing Date, the Issuer will publish a notice filed with the CSSF specifying the Cap so determined. For the avoidance of doubt, this notice will not constitute a supplement. Investment in the Warrant is not the same as investing in the Shares Prospective investors should be aware that the market value of the Warrants may not have a direct relationship with the prevailing price of the Shares, in that changes in the prevailing price of the Shares will not necessarily result in a comparable change in the market value of the Warrants. In addition, prospective investors should note that dividends paid to holders of the Shares will not be paid to the holders of a Warrant. The return on the Warrants will thus not reflect any dividends which would be paid to investors that have made a direct investment in the Shares. Consequently, the return on the Warrants may be less than the return from a direct investment in the Shares. Issue Price The Issue Price in respect of the Warrants may not be an accurate reflection of the market value of such Warrants as at the Issue Date. The price at which the Warrants may be sold in secondary market transactions may be lower than the Issue Price. In particular, the Issue Price in respect of the Warrants may take into account, amongst other things, the distribution fee payable to any appointed distributor of the Warrants with respect to the offer and sale of the Warrants. The Warrants are not capital protected Prospective investors should be aware that, unless stated otherwise, the Warrants are not capital protected. If the Warrants are not redeemed early then in certain circumstances the Redemption Amount may be less than 100 per cent. of the Issue Price and may even be nil. Risk-excluding or risk-limiting transactions Prospective investors may not rely upon being able to enter into transactions which may exclude or limit loss exposure to the Warrants during the term of the Warrants. The possibility of entering

6 into risk-excluding or risk-limiting transactions depends in particular on market conditions and the relevant underlying circumstances. Holders of Warrants may be able to enter into such transactions only at an unfavourable market price resulting in an additional loss for such holders of Warrants. Prospective investors intending to purchase Warrants to hedge the market risk associated with investing in the Shares should be aware of the difficulties associated therewith. For example, the value of the Warrants may not correlate with the value of the Shares. Potential conflicts of interest The Issuer, the Guarantor, the Dealer, the Calculation Agent and/or their respective subsidiaries may, from time to time, engage in purchase, sale or other transactions involving any of the Shares or related derivatives for their proprietary accounts and/or for accounts under their management and/or for clients. Such transactions may have a positive or negative effect on the price of such Shares and consequently on the value of the Warrants. In addition, the Issuer, the Guarantor, the Dealer, the Calculation Agent and/or their respective subsidiaries may, from time to time, act in other capacities with regard to the Warrants (such as in an agency capacity and/or as the calculation agent) and may issue or participate in the issue of other competing financial instruments in respect of any Shares or similar securities or assets in similar sectors or markets and the introduction of such competing financial instruments may affect the value of the Warrants. The Issuer, the Guarantor, the Dealer, the Calculation Agent and/or their respective subsidiaries may also (i) act as underwriter or financial adviser in connection with future offerings of shares or other securities of the companies which are issuers of any Shares comprising the Basket, their respective subsidiaries or affiliates and/or (ii) act in a commercial banking capacity for such companies in relation to any other related securities. Such activities could present certain conflicts of interest with the interest of the holders of the Warrants and may affect the value of the Warrants. The Issuer, the Guarantor, the Dealer, the Calculation Agent and/or their respective subsidiaries owe no duty or responsibility to any holders of the Warrants (or any other party) to avoid such conflicts. In connection with the offering of the Warrants, the Issuer, the Guarantor, the Dealer, the Calculation Agent and/or their respective subsidiaries may enter into one or more hedging transactions with respect to any of the Shares or related derivatives. In connection with such hedging or with respect to proprietary or other trading activities by the Issuer, the Guarantor, the Dealer, the Calculation Agent and/or their respective subsidiaries, the Issuer, the Guarantor, the Dealer, the Calculation Agent and/or their respective subsidiaries may enter into transactions in any of the Shares or related derivatives which may affect the market price, liquidity or value of the Warrants and which could be deemed to be adverse to the interests of the relevant holders of Warrants. Such activities and/or transactions could present certain conflicts of interest with the interest of holders of Warrants and may affect the value of the Warrants. The Issuer, the Guarantor, the Dealer, the Calculation Agent and/or their respective subsidiaries owe no duty or responsibility to any holder of Warrants (or any other party) to avoid such conflicts. Creditworthiness of the Issuer and Guarantor Any person who purchases the Warrants is relying upon the creditworthiness of the Issuer and the Guarantor and has no rights against any other person. The Warrants constitute general, unsecured, unsubordinated, contractual obligations of the Issuer and of no other person. The Warrants rank pari passu among themselves. Secondary market and liquidity for the Warrants There can be no assurance as to how the Warrants will trade in the secondary market, whether there will be a secondary market or, if a secondary market exists, whether such market will be sustainable or liquid or illiquid. Although an application will be made to list the Warrants on the

7 official list of the Luxembourg, no assurance can be given that the Warrants will in fact be listed or traded or, if the Warrants are so listed or traded, that such listing or trading will be maintained and whether there will be a secondary market for any Warrants so listed or traded. If the Warrants are not listed or traded on any stock exchange, pricing information for the Warrants may be more difficult to obtain, and the liquidity and market prices of the Warrants may be adversely affected. Issue Size The issue size will only be determined by the Issuer upon the termination of the Offer Period. If the issue size falls significantly short of the indicated issue amount of 2,500 Warrants, this might have adverse consequences on the expected liquidity of the Warrants. In any case, due to the relative complexity and lower liquidity of the Warrants if compared to more conventional financial instruments such as shares, comparatively larger spreads between bid and ask quotes should be expected. Trading Volume As the Warrants are directly linked to the Shares, where the volatility of the Shares increases, the trading value of the Warrants is expected to increase; if the volatility decreases, the trading value of the Warrants is expected to decrease. Additionally, as the time remaining to the expiration of the Warrants decreases, the trading value of the Warrants is expected to decrease. Prospective investors should be aware that changes in the value of any of the Shares and the different economic, financial or other factors that affect the Shares and the industry in which the issuer of such shares operates its business may have a direct effect on the value of the Warrants. An investment in the Warrants linked to the Shares may entail significant risks not associated with investments in conventional debt securities. Determinations and Adjustments by the Calculation Agent The Calculation Agent has certain discretions to determine whether certain events have occurred. Prospective investors should be aware that any determination made by the Calculation Agent may have an adverse effect on the value of the Warrants. For example, the Calculation Agent may determine that a Market Disruption Event has occurred or exists at a relevant time which may affect the determination of the price of any of the Shares on a relevant Scheduled Trading Day and/or may delay settlement in respect of the Warrants. Any such discretion exercised by, or any calculation made by, the Calculation Agent (in the absence of manifest error) shall be binding. The Calculation Agent may adjust the terms of the Warrants in the case of a Potential Adjustment Event, Merger Event, Tender Offer, Nationalisation, Insolvency or Delisting pursuant to terms as set out in the Offering Circular. No Security Investors in the Warrants do not have or receive any rights in respect of any Shares and have no right to call for any quantity of any Shares (or futures contract in relation thereto) to be delivered to them. The Issuer is not obliged by the terms of the Warrants to hold any Shares. Right to Cancel Early closing of the Offer Period shall be possible at the discretion of the Issuer. In addition, the Issuer reserves the right to cancel the offer if the amount of purchases are less than 250 Warrants, or if the Issuer assesses, at its absolute discretion, that any factors render it illegal, impossible or impractical, in whole or in part, to complete the offer or that there has been an adverse change in the market conditions. In such circumstances, purchasers will be reimbursed the purchase price

8 and any commission paid but will not receive any interest on such amounts. Notification of such cancellation shall be made to prospective investors by the Distributor. Adjustments The Calculation Agent may adjust the terms of the Warrants in the case of a Potential Adjustment Event, Merger Event, Tender Offer, Nationalisation, Insolvency or Delisting. Such adjustment may have an adverse impact on the value of the Warrants. Any such discretion exercised by, or any calculation made by the Calculation Agent (in the absence of manifest error) shall be binding. Transparency Directive Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of transparency requirements in relation to information about issuers whose securities are admitted to trading on an EEA Regulated Market and amending Directive 2001/34/EC (the Transparency Directive ) entered into force on 20 January It requires member states to take measures necessary to comply with the Transparency Directive by 20 January If, as a result of the Transparency Directive or any legislation implementing the Transparency Directive, the Guarantor could be required to publish financial information either more regularly than it otherwise would be required to or according to accounting principles which are materially different from the accounting principles which it would otherwise use to prepare its published financial information, the Guarantor may seek an alternative admission to listing, trading and/or quotation for the Warrants by such other listing authority, stock exchange and/or quotation system inside or outside the European Union as it may (with the approval of the Dealer) decide. Because the Warrants are registered in uncertificated and dematerialised book-entry form with Verdipapirsentralen ASA (the VPS ), investors will have to rely on their procedures for transfer, payment and communication with the Issuer. The Warrants will be registered in uncertificated and dematerialised form with the VPS in accordance with the Norwegian Securities Register Act of 2002 ( lov om registrering av finansielle instrumenter av 5 juli 2002 nr. 64 para. 2-1) and all other applicable Norwegian laws, regulations and operating procedures applicable to and/or issued by the VPS from time to time (the VPS Rules ). The VPS will maintain records of the beneficial interests in the Warrants and investors will only be able to trade their beneficial interest through the VPS. The Issuer will discharge its payment obligations under the Warrants by making payments in accordance with the VPS Rules. A holder of an interest in the Warrants must rely on the procedures of the VPS to receive payments under the Warrants. The Issuer has no responsibility or liability for the records relating to, or payments made in respect of, interests in the Warrants.

9 Part B Information incorporated by reference Terms used herein but not otherwise defined shall have the meanings given to them in the Offering Circular dated 8 August The following information contained in the Offering Circular shall be deemed to be incorporated into and form part of this Securities Note. Page references are to pages in the Offering Circular. Page Reference The section entitled Risk Factors 8 to 18 The section entitled Terms and Conditions of the Securities 42 to 87 The section entitled Annex C Norwegian Securities 94 to 97 The section entitled Use of Proceeds 101 The section entitled United States Taxation 131 The section entitled Luxembourg Taxation 132 to 133 The section entitled Netherlands Antilles Taxation 131 to 132 The section entitled EU Savings Tax Directive 143 to 144 The section entitled Offering and Sale 122 to 130 The first ( Authorisation ), second ( Listing ), third ( Substitution ), fifth 145 to 148 ( Clearing Systems ) and tenth ( Transparency Directive ) paragraphs of the section entitled General Information In addition, the following information shall be deemed to be incorporated into and form part of this Securities Note: Page Reference The Offering Circular Supplement No. 1 dated 15 October 2007 to the 1-5 Offering Circular dated 8 August The Offering Circular Supplement No. 2 dated 4 January 2008 to the 1-2 Offering Circular dated 8 August The Offering Circular Supplement No. 3 dated 12 February 2008 to the 1-2 Offering Circular dated 8 August Any information not listed in the cross-reference lists but included in the documents incorporated by reference (if any) is given for information purposes only. The Issuer will provide, without charge, to each person to whom a copy of this Securities Note has been delivered, upon the oral or written request of such person, a copy of any or all of the documents which or portions of which are incorporated herein by reference (save that a holder of a Warrant must produce evidence satisfactory to the Issuer as to its identity). In addition, such documents, will be available (i) without charge from the specified office of the Luxembourg Paying Agent or (ii) on the website of the Luxembourg at

10 Part C Information about the Securities CONTRACTUAL TERMS Terms used herein shall be deemed to be defined as such for the purposes of the Conditions set forth on pages 42 to 87 of the Offering Circular which are incorporated into, and form part of, this Securities Note. References in the Conditions to Final Terms shall, where the context so permits, be deemed to be references to the Contractual Terms set out below. General 1. Issuer: Lehman Brothers Securities N.V. 2. Guarantor: Lehman Brothers Holdings Inc. 3. Description of the Securities: (a) Warrants or The Securities are Warrants Certificates: (b) Type of Securities: The Securities are Share Securities 4. Form of Securities: The Securities are Norwegian Securities and are registered in uncertificated and dematerialised book-entry form. 5. Description of the Underlying: 6. If Warrants, American Style Warrants, European Style Warrants or other: 7. If Warrants, Call Warrants, Put Warrants or other: 8. (a) Number of Securities being issued: A basket of 10 ordinary shares (each a Share or " Share i" (where i = 1 to 10) and collectively the Shares or the Basket ) European Style Warrants Call Warrants Up to 2,500 Warrants (b) Specified Notional Amount per Security: Norwegian Krone ( NOK ) 100, (a) Series Number: 08/208 (b) Tranche Number: Issue Date: 09 May Issue Price(s): NOK 21,500 per Warrant In connection with the sale of the Warrants, the Distributor (as defined in paragraph 14 of Part C below) may acquire the Warrants from the Dealer at a discount to the Issue Price or at the Issue Price. Alternatively, if a Distributor acquires the Warrants at the Issue Price, the Dealer will pay a distribution fee to such Distributor. Any such amount received by a Distributor may be in addition to the

11 brokerage cost/fee normally applied by such Distributor. Neither the Dealer nor the Issuer has any further information with respect to the contractual or financial arrangements between a Distributor's customers and such Distributor or whether and, if so on what terms such Distributor is willing to assist its customers or potential customers. Any person seeking further information with respect to such matters should refer to the relevant Distributor. Neither the Dealer nor the Issuer is responsible for (i) the contractual arrangements between a Distributor and its customer, (ii) any information so provided or (iii) for whether or not the Distributor provides such information. The Dealer reserves the right, in its sole discretion, at any time and from time to time, to offer and sell the Warrants at one or more prices that differ from the Issue Price. 12. Minimum initial purchase of the Securities: 13. Minimum transferable number (for the purposes of Condition 1(c)): 14. Last Trading Day (for the purposes of Conditions 1(c) and 9(c): One Warrant One Warrant and integral multiples of one Warrant thereafter The Expiration Date Warrants - Provisions relating to exercise 15. If American Style Warrants, the Exercise Period: 16. If European Style Warrants, the Expiration Date: 17. Exercise Notice Deposit Time(s) (for the purposes of Condition 5(a)): 18. Minimum Exercise Number (for the purposes of Condition 5(b)): 19. Integral multiple of Minimum Exercise Number (for the purposes of Condition 5(b)): 20. If Physical Delivery Warrants, any modification of minimum Board Lot requirement in relation to exercise (for the purpose of The Valuation Date

12 Condition 9(h)): 21. If American Style Warrants, the Maximum Exercise Number (for the purposes of Condition (b)): 22. Automatic Exercise in respect of Cash Settled Warrants (for the purposes of Condition 4(a)): Applicable Certificates - Provisions relating to interest 23. Interest Payment Dates: 24. Notional Amount per Certificate (for the purposes of Condition 6): 25. Interest Rate (for the purposes of Condition 6): 26. Interest Rate Day Count Fraction (for the purposes of Condition 6): 27. Other terms relating to the method of calculating interest (for the purposes of Condition 6): Provisions relating to settlement and redemption 28. Form of Settlement (for the purposes of Condition 1(a)): 29. Issuer s option to vary settlement in respect of the Securities (for the purposes of Conditions 1(a) and 10(c)): Cash Settled Securities 30. Valuation Date: 25 April Averaging Dates: The 25 th day of each calendar month from and including 25 April 2010 to and including the Valuation Date. There shall be a total of thirteen (13) Averaging Dates. 32. Consequence of Averaging Modified Postponement Date Disruption (for the purposes of Condition

13 13(b)): 33. Valuation Time: In respect of each Share, the official close of trading of the relevant. 34. If Warrants, the Settlement Date: 35. If Certificates, the Certificate Settlement Notice Period: 36. If Certificates, the Redemption Date: 09 May Business Day Centre(s): London and Oslo 38. Rate, including details of when such rate is to be ascertained: 39. If Cash Settled Securities, Settlement Currency for the payment of the Cash Settlement Amount and/or Alternative Cash Settlement Amount: 40. If Cash Settled Securities, Cash Settlement Amount or method of calculation of the Cash Settlement Amount (for the purposes of Condition 4(b) or Condition 7, as applicable): NOK Unless the Warrants have been previously redeemed or cancelled, the Issuer shall pay to the holder of the Warrants on the Settlement Date an amount per Warrant in the Settlement Currency ( Cash Settlement Amount or CSA ) as determined by the Calculation Agent on the Valuation Date in accordance with the following formula: CSA = SNA PF Max Basket ( Value - 1 ; 0 ) USDNOK final USDNOK initial Where: Basket means the basket of shares set out in the Annex hereto; Basket Value or BV means an amount determined by the Calculation Agent in accordance with the following formula: BV Share Min = Share i, final i 1 i, 0 ; Cap Cap means a percentage, subject to a minimum of per cent., to be determined by the Calculation Agent in its sole and absolute discretion on the Strike Fixing Date. The Issuer will, as soon as practical after the determination by the Calculation Agent of the Cap on the Strike Fixing Date, publish a notice to be filed with the CSSF specifying

14 the Cap so determined. This notice may be viewed on the website of the Luxembourg at For the avoidance of doubt, this notice will not constitute a supplement. Hedging Party means the Issuer, any of its affiliates or any over-the-counter derivatives transaction counterparty in relation to any hedge transaction established and/or unwound in connection with the Warrants. Rate means, in respect of each Share i and a Scheduled Trading Day, the NOK/U.S. Dollar exchange rate, expressed as the amount of NOK per one U.S. Dollar, at which the Hedging Party would, if so determined, be able, using commercially reasonable efforts, to execute a corresponding FX transaction at or around the Valuation Time on such Scheduled Trading Day, as determined by the Calculation Agent. For the avoidance of doubt, the Hedging Party does not owe, and shall not be deemed to owe, a duty of best execution in executing any such transaction Max means the maximum or the greater of the bracketed number or formula separated by a semi-colon; Min means the minimum or the lesser of the bracketed number or formula separated by a semi-colon; Participation Factor or PF means 100 per cent.. Share i means a Share comprising the Basket, where i = 1 to 10; Share i,0 means the price of a Share i on the relevant at the Valuation Time on the Strike Fixing Date as determined by the Calculation Agent; Share i,final means in respect of a Share i, the arithmetic average of the price of such Share i on the relevant at the Valuation Time on each Averaging Date, as determined by the Calculation Agent; SNA means NOK 100,000; Strike Fixing Date means 09 May The Strike Fixing Date shall be deemed to be a Valuation Date for the purposes of Conditions 28 (Definitions) and 13 (Consequences of Disrupted Days ); USDNOK initial means the Rate on the Strike Fixing Date; USDNOK final means the Rate on the Valuation Date; and U.S. Dollar means the lawful currency of the United States of America.

15 41. If Physical Delivery Warrants, the Strike Price(s): 42. If Physical Delivery Securities: (a) (b) (c) (d) the Relevant Asset(s) (for the purposes of the definition in Condition 28): method of delivery of the Physical Settlement Amount (for the purposes of Condition 10(b)(i) or (ii)): method of evidencing the Physical Delivery Amount (for the purposes of Condition 10(b)(i) or (ii)): treatment of dividends payable on the Relevant Assets(s) (for the purposes of Condition 10(b)(iii)): 43. If Physical Delivery Certificates, any modification of minimum Board Lot requirement in relation to settlement (for the purpose of Condition (h)): 44. Other circumstances where Holder will receive the Alternative Settlement Amount (for the purposes of Condition 10(c)): 45. Other additional conditions to settlement (for the purposes of Condition 10(a)(i), 10(a)(ii), 10(b)(i) and 10(b)(ii)): Other specified terms and modifications to the Conditions 46. If Currency Securities, details of the Relevant Screen Page, the Base

16 Currency and the relevant Subject Currency or Subject Currencies: 47. If Commodity Securities, provisions for calculations: 48. If Index Securities: 49. If Share Securities: (a) Share(s): See Annex hereto (b) : See Annex hereto (c) Related : See Annex hereto (d) (e) Method of Adjustment (for the purposes of Condition 14(b)): Consequences of Merger Events (for the purposes of Condition 15(a)): Calculation Agent Adjustment (i) (ii) (iii) Share-for-Sh are: Share-for-Co mbined: Share-for-Ot her: Modified Calculation Agent Adjustment Modified Calculation Agent Adjustment Modified Calculation Agent Adjustment (f) Consequences of Tender Offers (for the purposes of Condition 15(b)) (i) (ii) (iii) Share-for-Sh are: Share-for-Co mbined: Share-for-Ot her: Modified Calculation Agent Adjustment Modified Calculation Agent Adjustment Modified Calculation Agent Adjustment (g) Options (for the purposes of Condition 14(b)(i), Condition 15(a)(iii) or Condition 15(b)(ii), where applicable) 50. Additional Disruption Events:

17 (a) (b) Applicable Additional Disruption Events: Consequences of Additional Disruption Event: Hedging Disruption As per Condition 16(a) 51. Further adjustments: (a) (b) (c) whether provisions for market disruption apply other than as provided for in Condition 13 (Consequences of Disrupted Days): in relation to Debt Instrument Securities, provisions dealing with the situation where one or more of the relevant Debt Instruments is redeemed (or otherwise ceases to exist before expiration of the relevant Securities): any supplemental adjustment provisions: 52. Other special conditions and any modification to the Terms and Conditions of the Securities: 53. Relevant Clearing System(s) (for the purposes of the definition in Condition 28): 54. Calculation Agent if not the Issuer: VPS Biskop Gunnerus Gate 14 A 0185 Oslo, Norway Lehman Brothers International (Europe), 25 Bank Street, London E14 5LE, United Kingdom 55. Rule 144A eligibility: No 56. Eligibility for private placement to other accredited investors in the United States: 57. US Selling Restrictions and additional selling

18 restrictions: (a) (b) details of the applicable type of US Selling Restrictions including in respect of the relevant US Selling Restrictions certification required for the purposes of exercise or redemption: details of any additional selling restrictions (for the purposes of Condition 9(e)): Type 2A 58. Non-exempt Offer: An offer of the Securities may be made by the Distributor other than pursuant to Article 3(2) of the Prospectus Directive in Norway during the period from 25 March 2008 to and including 02 May See further Paragraph 14 of Part B below. OFFER PERIOD, ISSUE SIZE AND ISSUE PRICE The offer of the Warrants will commence at 8.00 a.m. (C.E.T.) in Norway on 25 March 2008 and end at 6.00 p.m. (C.E.T.) in Norway on 02 May 2008 or at a such other time on such earlier other date as the Dealer may decide in its absolute discretion in light of prevailing market conditions (the Offer Period ). LISTING, ADMISSION TO TRADING AND PUBLIC OFFER The Warrants will be listed on the official list of the Luxembourg and admitted to trading on the regulated market of the Luxembourg which is a Regulated Market for the purposes of Directive 2004/39/EEC within the meaning of the Prospectus Directive. This Securities Note and the Summary have been approved by the CSSF, which is the Luxembourg competent authority for the purpose of the Prospectus Directive and relevant implementing legislation in Luxembourg; this Securities Note, the Registration Document and the Summary together constitute the Prospectus (the Prospectus ) issued in compliance with the Prospectus Directive and relevant implementing legislation in Luxembourg for the purpose of giving information with regard to the issue of the Warrants. In addition, the CSSF, in its capacity as competent authority in Luxembourg for the purposes of the Prospectus Directive, has been requested to provide the Oslo ( Oslo Børs), which is the competent authority in Norway by delegation of authority from the Norwegian Financial Supervisory Authority (Kredittilsynet ), which is the competent authority in Norway for the purposes of permitting an offer of Warrants to the public in Norway, in accordance with the Prospectus Directive, with a certificate of approval attesting that the Prospectus has been drawn up in accordance with the Prospectus Directive, together with a copy of the Prospectus (the Passporting Documents ). The Issuer will, as soon as practicable after the determination by the Calculation Agent of the Cap on the Strike Fixing Date, publish a notice to be filed with the CSSF specifying the Cap so determined and the number of Warrants (if any) to be issued. This notice can be viewed on the website of the Luxembourg at For the avoidance of doubt this notice will not constitute a supplement.

19 Save for the approval of the Securities Note and Summary by the CSSF and request for the CSSF to provide the Oslo Børs with the relevant Passporting Documents as discussed above, none of the Issuer, the Guarantor or the Dealer has taken or will take any action in any country or jurisdiction (other than Norway) that would permit a public offering of the Warrants or possession or distribution of any offering material in relation to a public offering in any country or jurisdiction where action for that purpose is required. Each investor must comply with the restrictions set out in the section Offering and Sale of the Offering Circular in relation to each country or jurisdiction in or from which the investor purchases, offers, sells or delivers the Warrants or has in the investor s possession or distributes the Prospectus.

20 OTHER INFORMATION 1. Listing / Admission to Trading : Application is expected to be made by the Issuer (or on its behalf) for the Securities to be listed on the official list of the Luxembourg. Application is expected to be made by the Issuer (or on its behalf) for the Securities to be admitted to trading on the regulated market of the Luxembourg. No assurance can be given as to whether or not or when such application for listing / admission to trading will be granted. 2. Notification: The CSSF, has been requested to provide the competent authority in Norway, the Oslo Børs, with a certificate of approval attesting that the Prospectus has been drawn up in accordance with the Prospectus Directive. 3. Interests of Natural and Legal Persons Involved in The Issue/Offer 4. (a) Method of distribution of the Securities: Save as discussed in Offering and Sale in the Offering Circular and set out in paragraph 14 below, so far as the Issuer is aware, no person involved in the offer of the Securities has an interest material to the offer. Non-syndicated (b) Name of the Dealer(s): Lehman Brothers International (Europe) having its registered office at 25 Bank Street, London E14 5LE, United Kingdom. 5. ISIN: NO Common Code: CUSIP: 8. Telekurs number and, where any additional or alternative Clearing System(s) has/have been specified in paragraph 53 above, any other relevant security code: 9. Principal Securities Agent: Norwegian Issuing Agent: DnB NOR Bank ASA, Securities Services, Stranden 21, 0021, Oslo, Norway 10. Whether Definitive Security The Securities are Norwegian Securities and will at Certificates may be issued as well all times be registered in uncertificated and as/instead of a Global Security: dematerialised book-entry form. 11. Reasons for the Offer: The Issuer intends to use the proceeds of the offer for general purposes and for hedging the obligations created by the issuance of the Securities.

21 12. Estimated total expenses: NOK 190,000 (excluding Distributor s fees). The Distributor is defined in paragraph 14 below. 13. Estimated net proceeds: Up to NOK 53,750, Terms and Conditions of the Offer Distributor s fees are paid via a discount on the re-offer price and amount up to NOK 5,500 per Warrant. Offer Price: Conditions to which the offer is subject: Description of the application process: Issue Price Application to subscribe the Warrants may be made by sending a completed application form to the Distributor. In connection with the sale of the Warrants, the Distributor (as defined in paragraph 14 of Part C below) may acquire the Warrants from the Dealer at a discount to the Issue Price or at the Issue Price. Alternatively, if a Distributor acquires the Warrants at the Issue Price, the Dealer will pay a distribution fee to such Distributor. Any such amount received by a Distributor may be in addition to the brokerage cost/fee normally applied by such Distributor. Neither the Dealer nor the Issuer has any further information with respect to the contractual or financial arrangements between a Distributor's customers and such Distributor or whether and, if so on what terms such Distributor is willing to assist its customers or potential customers. Any person seeking further information with respect to such matters should refer to the relevant Distributor. Neither the Dealer nor the Issuer is responsible for (i) the contractual arrangements between a Distributor and its customer, (ii) any information so provided or (iii) for whether or not the Distributor provides such information. Description of possibility to reduce subscriptions and manner for refunding excess amount paid by applicants: The Issuer reserves the right to withdraw the offer if the overall amount subscribed for is less than 250 Warrants. Moreover, completion of the offer is conditional upon the offer not being, in the view of the Issuer, made wholly or partially impossible or materially more difficult by laws or regulations, decisions made by government authorities, or similar circumstances in Norway or in any other jurisdiction. The Issuer also reserves the right to withdraw the offer, reduce the Offer Period or limit the scope of the offer if it is of the view that market conditions make completion of the offer difficult. Withdrawal may take place until 09 May The maximum amount of this offer is 2,500 Warrants.

22 Details of the minimum and/or maximum amount of application: Details of the method and time limits for paying up and delivering the Securities: Manner in and date on which results of the offer are to be made public: Procedure for exercise of any right of pre-emption, negotiability of subscription rights and treatment of subscription rights not exercised: Categories of potential investors to which the Securities are offered and whether tranche(s) have been reserved for certain countries: Process for notification to applicants of the amount allotted and the indication whether dealing may begin before notification is made: Minimum amount of application per investor: One Warrant. By notice as described above. The Issuer will, as soon as practical after the end of the Offer Period, publish a notice to be filed with the CSSF specifying the number of Warrants issued. This notice can be viewed on the website of the Luxembourg at The Warrants will be offered to the public in Norway during the Offer Period. The Warrants are expected to be registered in the investors VPS accounts on approximately the Issue Date. The registration will be confirmed via the distribution of a VPS confirmation to each investor. Dealing may not begin before confirmation is made to investors. Amount of any expenses and taxes specifically charged to the subscriber or purchaser: Name(s) and address(es), to the extent known to the Issuer, of the placers in the various countries where the offer takes place: None Warren Wicklund Asset Management AS (the Distributor ) Post Issuance Information The Issuer does not intend to provide any post issuance information, except if required by any applicable laws and regulations. Details on the past and future performance and the volatility of the Shares can be obtained from Bloomberg and under the Bloomberg codes set out for each Share in the Annex.

23 Part D Norwegian Taxation The following summary of certain tax issues that may arise as a result of holding the Warrants is based on current Norwegian tax legislation and is intended only as general information for holders of Warrants, who are resident in Norway for tax purposes. This description does not deal comprehensively with all tax consequences that may occur for holders of Warrants. Special tax consequences that are not described below may also apply for certain categories of tax payers, including, mutual funds and persons who are not resident in Norway. It is recommended that prospective applicants for Warrants consult their own tax advisers for information with respect to the special tax consequences that may arise as a result of holding Warrants, including the applicability and effect of foreign income tax rules, provisions contained in double taxation treaties and other rules which may be applicable. Separate or integrated taxation Whether the Warrants will be subject to separate taxation on settlement or integrated taxation with the underlying assets depends, inter alia on the nature of the underlying object of the Securities. Financial options, i.e. options on shares, debentures, foreign currency, quoted financial instruments and index options are always taxed separately from the underlying asset. Whether financial instruments other than financial options will be taxed separately or integrated must be evaluated in each case. However, financial instruments will as a starting point be subject to separate taxation if the main purpose of the instrument is not to arrange for the transfer of the underlying object of the instrument. On this basis, the Warrants will most likely be subject to separate taxation in Norway. This is assumed in the following where the question is of importance. Individuals Tax liability Both returns received on the Warrants, if any, (in the form of payments from the issuer) and capital gains received on realisation (including sale) of the Warrants are, with the exceptions described below, taxable as ordinary income, which is currently taxed at a flat rate of 28 per cent for Norwegian individuals. Losses on realisation of the Securities are deductible in the ordinary income of the individual. Calculation of capital gains and losses Capital gains or losses are computed based on the difference between the consideration received on realisation and the cost price of the Warrants. The cost price of the Warrants is equal to the price at which the holder acquired the Warrants. Costs incurred in connection with the acquisition and realisation of the Warrants may be deducted from the holder s ordinary income in the year of realisation. Settlement, sale and expiry of Warrants Capital gains taxation is triggered on settlement or sale of the Warrant. If the Warrant expires, it is deemed realised, incurring a loss equal to the acquisition cost. A loss is deductible as set out above. Return received on the Warrants Return received on the Warrants, if any, is taxable for the holder. Net wealth taxation